California AB 723: the Digitally Altered Photo Disclosure law explained

What AB 723 actually requires

AB 723 amends the California Real Estate Law to require clear disclosure whenever a property image used in marketing or advertising has been digitally altered. The law has two parts. First, every altered image must carry a visible disclosure that it has been digitally altered. Second, viewers must have a way to access the original unaltered version of the image.

The disclosure has to be either embedded directly on the image (the watermark approach) or placed immediately adjacent to it in the listing or advertisement (the caption approach). Either is acceptable. What isn't acceptable is a disclosure buried in fine print at the bottom of a listing, in a separate document, or only on an off-platform website.

What counts as “digitally altered”

The law targets material changes to what a property actually looks like. The clearest cases:

• Virtual staging.Adding furniture, art, plants, or any other items that aren't physically in the home.
• Object removal. Erasing trash cans, parked cars, power lines, neighboring buildings, signage, or any other element that exists on the actual property.
• Sky replacement. Swapping a cloudy sky for blue, or adding sunsets.
• AI generation or enhancement. Any image that was generated or substantially modified by AI tools.
• Cosmetic upgrades. Replacing existing finishes (countertops, flooring, paint color) with digital versions of upgraded ones.
• Lawn and landscaping changes. Greening brown grass, adding flowers, removing dead trees.

What doesn't count

Standard photographic adjustments aren't covered. You can still:

• Correct exposure, contrast, white balance, and color
• Crop, straighten, and rotate
• Remove minor lens artifacts and dust spots
• Apply tasteful sharpening and noise reduction
• Use HDR processing on multiple exposures of the same scene

The dividing line is whether a reasonable buyer looking at the photo would see something different from what they'd see standing in the property on a typical day. Brightness, no. Adding a couch that doesn't exist, yes.

The disclosure spec

The law doesn't mandate a specific font, size, or color. What it does require is that the disclosure be:

• Visible at the typical resolution the image will be displayed at
• Not easily removable by cropping or re-editing
• In language a reasonable viewer would understand as a disclosure

The phrase “Digitally Altered” is the safest wording. Other acceptable variants include “Image Digitally Altered”, “Virtually Staged”, and “AI-Enhanced.” Avoid vague phrases like “Edited” or “Enhanced” without context, since those words don't clearly communicate that the image differs from reality.

How to comply, step by step

1. Identify which photos in your shoot were materially altered. If you used a virtual staging service, ask them which deliverables are staged versus raw.
2. For each altered photo, add a watermark in a non-removable position. A common pattern is the bottom-right corner of the image, in white or light grey, with a subtle drop shadow for readability against busy backgrounds.
3. Keep the original unaltered file. Store it in a publicly accessible link (Dropbox, Google Drive, or your brokerage's photo CDN). Add the link to the listing description, the photo caption, or the MLS notes.
4. Apply the same disclosure across every channel where the image appears. MLS, Zillow, Redfin, your website, Instagram, Facebook, flyers, postcards, print ads, open house signage. AB 723 covers all of them.
5. Re-check before every upload. CRMLS doesn't scan for the disclosure, but agents who report it can trigger a compliance review.

Penalties for non-compliance

AB 723 sits under the California Real Estate Law, which gives the Department of Real Estate broad discretion in how it enforces. Reported penalties for similar disclosure violations have included:

• Citations and fines (typically starting at a few hundred dollars)
• Mandatory continuing education requirements
• License suspension for repeated or willful violations
• Civil liability if a buyer can show they relied on a misleading photo and were damaged

CRMLS itself can also issue independent citations under MLS rules. Multiple CRMLS infractions in a calendar year can result in temporary loss of MLS access.

CRMLS-specific guidance

CRMLS published a matching FAQ in November 2025 confirming that altered images on CRMLS listings must carry the AB 723 disclosure. The key points from that FAQ:

• CRMLS treats the AB 723 disclosure as separate from the existing rule against agent branding (logos, phone numbers, URLs). You can violate both at once on the same photo.
• The disclosure has to be visible at the resolution CRMLS displays photos at. A watermark that disappears at thumbnail size doesn't count.
• CRMLS staff can request the original unaltered file at any time. Not being able to produce it is itself a violation.

Frequently asked questions